Pilots for Memphis-based FedEx approve new labor agreement!

By Wayne Risher
Updated Wednesday, March 23, 2011

FedEx and its pilots secured labor peace, at least for another year or two, with union approval of contract amendments Wednesday.

The agreement will run one year or two, at the union’s option, and provide for 3 percent annual raises, 1 percent lump sum payments up to $2,600, new safety programs and expanded foreign duty assignments.

The pact, hammered out by FedEx management and the Air Line Pilots Association in less than six months, was approved by about 68 percent of pilots participating in the vote. The union, which represents 4,500 FedEx pilots, said more than 84 percent of members cast ballots.

It’s seen as a stopgap measure that defers contentious matters like work rules pending new Federal Aviation Administration flight hours and rest requirements due out later this year. It would run through March 2013 unless ALPA cuts it off at one year, in which case pilots wouldn’t get another 3 percent bump a year from now.

It comes with a written pledge for continued discussions on thornier issues that need to be addressed in the next round of negotiations.

“In the end, we achieved an agreement that brings meaningful improvements in key areas while positioning us to resolve our remaining issues in the near future,” said Capt. Scott Stratton, chairman of ALPA’s FedEx master executive council.

He added, “This is a positive departure from aviation industry negotiations which regularly fail to produce agreements in a timely fashion. Our effort to obtain this agreement was led by our negotiating committee, chaired by Captain John Gustafson, and backed by ALPA’s professional staff.”

FedEx Corp. spokesman Maury Lane said, “We are pleased that the agreement between the union and company was ratified today. This new agreement balances the interests of the pilots, their families, our customers, shareowners and other employees very well, and includes immediate pay increases, provisions for opening a pilot base in Europe, leading edge safety programs and increases in travel per diem.”

The agreement clears the way for FedEx to station more pilots abroad to serve international shipping growth by establishing a foreign duty assignment in Cologne, Germany, to join Hong Kong.

“International express is the fastest growing part of the business, and worldwide air freight volumes have been the one freight mode that has not only gotten back to pre-recession highs, but has gotten above pre-recession highs,” said Donald Broughton, a shipping industry analyst with Avondale Partners LLC. “Demand for that service is growing. That’s why FedEx wants more pilots with that designation.”

The contract’s short duration recognizes potential changes in working conditions that could come from new pilot rules.

Previous negotiations took about 30 months before resulting in 2006 in a four-year contract that became amendable last year.

Examples of new pay rates weren’t available but FedEx pilots top out at $246 an hour under the outgoing contract.

Some pilots groused on Internet message boards about what the agreement didn’t address, such as improved retirement benefits and stronger work rules.

But Dan Ventre, a Boeing 777 pilot based in Memphis, said, “It is what it is. I see it as a bridge until the national duty hours rulemaking takes place.”

“Work rules are everything in the quality of life of a pilot,” Ventre added.

Darryl Jenkins, chairman of the American Aviation Institute in Washington, said, “I like short-term agreements when things are not settled. I think that’s just smart on everybody’s part to be doing that. When you’re not sure of the future and push that planning horizon out three to five years, that’s just a recipe for disaster for everybody.”

Ventre said he believes safety will be enhanced by instituting the Aviation Safety Action Program (ASAP) and the Flight Operations Quality Assurance Program.

ASAP allows pilots to self-report certain safety incidents with immunity from disciplinary measures. The quality assurance program allows for the company to mine aircraft data recordings, without identifying individual pilots, to monitor compliance with policies and procedures.